June 22, 2024

Political Commentary

News Politics Business Sports

Oil majors call on Washington and Brussels to intervene in LNG dispute

2 min read

Stay informed with free updates

Shell and BP have asked Washington and Brussels to intervene in a bitter dispute with Venture Global LNG, warning the company’s refusal to honour a multibillion-dollar liquefied natural gas supply contracts threatens Europe’s energy security.

In correspondence seen by the Financial Times, the oil majors accuse the US LNG provider of “misconduct” for withholding cargo agreed under long-term supply contracts and instead selling LNG on the spot market.

Shell alleges Venture Global’s “opportunistic” action has enabled it to reap an $18bn windfall because of a spike in gas prices following Russia’s invasion of Ukraine while denting its ability to meet critical energy supply needs in Europe.

The accusations have sparked a war of words, with Venture Global branding as “outrageous” the companies’ “request for interference” from the governments in binding contracts.

The supermajors, alongside Spain’s Repsol and Italy’s Edison, are among several foundation customers embroiled in contract arbitration with Venture Global. Foundation customers agree long-term contracts that help LNG providers attract financing to build their projects.

The European energy groups are all seeking to force the US company to deliver the contracted cargo or pay financial penalties under a process that could take years.

The call for intervention from the joint EU-US Task Force on energy security — set up after Russia’s invasion of Ukraine to spur US gas exports to Europe — marks a significant escalation of the dispute. The body is headed by senior officials, including Ditte Juul Jørgensen, director-general for energy at the European Commission, and Amos Hochstein, US President Joe Biden’s senior adviser on energy.

Shell said in a letter to the officials seen by the FT: “Such short-sighted, unprecedented conduct sets a concerning precedent that…

2023-11-11 08:42:58

All news and articles are copyrighted to the respective authors and/or News Broadcasters. VIXC.Com is an independent Online News Aggregator

Read more from original source here…

Leave a Reply

Copyright © All rights reserved. | Newsphere by AF themes.